Can anyone get through life without ever possessing a credit card at some point? I got my first credit card when I went off to college to use for gas and emergency purchases, such as car repairs, etc. I had a credit card when I got married. Then, the miraculous happened. I was set free from credit card servitude about three years ago. All our credit cards went the way of the shredder and we have never looked back. The peace that comes from such a decision is amazing and I am always more than happy to talk to anyone about it. Most people in my inner circle totally agree with me. But, being that my inner circle is rather quite small, most people I know or come in contact with do not understand my opinions on credit cards. I will allow their arguments in support of credit cards to represent the ‘Pros’ part of this article. I will represent the ‘Cons’ because I honestly don’t think there is anything good about them. Let the battle begin.
‘Benefits’ of Credit Cards
A credit card is crucial to building your credit history or credit score. When you are wanting to buy a car or a house the loan provider will want to look at your credit history as a way of determining whether you are a good prospect for a risky loan. A credit card is an easy way to build your credit history up by using the credit card and paying the bill on time.
A credit card offers convenience. There is nothing easier than swiping your card through the reader. Who wants to fumble through your wallet to pull out cash at every vendor when you are running errands? And who wants to withdraw that much money each week or month?
Credit cards provide security. It is true that carrying around large sums of money in your wallet is a less than safe prospect. Credit cards allow you to leave all that cash in the protection of the bank. Your money is more protected with a credit card because most credit card companies will refund your money if you dispute a fraudulent charge. Cash does not provide such protections.
Credit Cards offer flexibility. There are times when you need to make a purchase and the money just isn’t in the bank account. What if you need to buy some basic groceries and your commission-only paycheck hasn’t been deposited yet? What can you do? You can use a credit card to buy the milk now and then pay later when the paycheck does show up. And if you pay entire bill within the offered grace period you don’t even have to pay interest on it.
Credit Cards allow you to shop on line. It has been said that on line shopping will be the only form of shopping in the future. There is no doubt that more and more people are exponentially jumping on the on line bandwagon. Just like it was said above, credit cards make shopping very convenient especially when you don’t even have to leave the comfort of your own home.
Dangers of Credit Cards
There is no emotional attachment to your money. You tell me, how does it feel when you have to hand over a lot of cash to buy something. Not good at all. It makes you think twice before you buy something you don’t need. You don’t feel that pain with credit cards. It is far easier to swipe plastic than it is to hand over cold hard cash. For that reason, it is way to easy to overspend with credit cards.
Credit Cards keep you in debt. This where the world ‘servitude’ that I used above comes from. I truly believe that when you owe someone money you are his or her servant. That person owns you for the duration of the loan. You don’t own that car until it is paid off. The bank does. You don’t own anything until you pay off the credit card you used to pay for it. Personally, I have no desire to be in servitude to anyone and for that reason I avoid credit cards like the plague. A compromise could be to pay off the credit card each month but even then you are in debt each month until you pay that bill. When bad things happen it is way too easy to not pay the whole bill and then you carry one month’s debt into the next and it spirals down from there.
Credit Cards increase the chances of identity theft. Credit Card information is the main place that identity thieves go to for your information so they can take over your life. I think I would rather risk losing the cash in my wallet over losing my identity and losing far more money.
Credit Cards make it too easy to live beyond your means. You want to buy that fancy stereo? Sure, use your credit card! What about those nice new clothes that are on sale!! No problem, here’s my credit card. Like I said before it is so easy to swipe that plastic card. You don’t feel it. You have no attachment to something that is virtual. For this reason, most people who live on credit cards actually spend more than they make. By paying part of the bill each month they can just float that money forever and continue living that lifestyle. It is a lie and it is servitude. You are one missed payment from financial destruction.
Credit Card Companies Offer Rewards. Don’t you just love those points you get for every dollar you spend on the credit card? Aren’t they nice to reward you for using their card? You just earned a gift card to Target! And how much did you have to spend to get that $25 gift card? Was it worth it? Companies want you to stay with them and they want you to spend more money. So, they have these programs. The offer of rewards encourages most people to use their credit cards more and to spend more. It is deceptive and rude.
I know from personal experience of being credit card free that you can indeed live just fine without one. It does take more planning at the start of each month to budget your money. But, once you are used to do that it takes hardly any time at all. Yes, you do carry around more cash. Sometimes I get nervous about it. But, I never go over budget on my groceries because if the money isn’t there I don’t buy groceries. There is no head scratching at the end of the month wondering where all the money went. I know exactly where it went because I had a plan. And just so you know, you can use a debit card too. A debit card can do all the same things that a credit card can do like booking hotels, airplane tickets, and rental cars. You just run the debit card like a credit card and you have the same protections of a credit card (in other words, you don’t punch in your pin number). Also, I am not worried about buying a car because we buy our cars in cash. We don’t want that debt either. I will say in full disclosure that we do have a house mortgage but it is our only debt and we strive to pay it off as quickly as possible. Life without credit cards is possible. Give it a try. You’ll love the freedom.
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